Renewable Power Plants Allowed to Supply Legal Cryptominers

EghtesadOnline: The Energy Ministry has announced new rules for supplying cryptominers electricity generated from renewable power plants.

News ID: ۷۸۷۵۲۴

28 December 2021

“Legal miners can enter into agreements with renewable power plants at negotiable terms and rates…The Energy Ministry will have role in setting the rates," Mohammad Khodadadi, head of the cryptominers power supply department at the main utility (Tavanir), told ISNA.

Mining virtual currency is legal in Iran and miners can operate under government rules. They must have a license from the Ministry of Industries and pay their electricity bills based on power export tariffs.

Power plants and the mining farm are not required to be located in a similar location," he said, "Electricity can be transferred across the country at the agreed rates via the national grid,” Khodadadi said.

Recalling that power generation by renewable plants is intermittent, he said the Iran Power Generation, Distribution and Transmission Company (Tavanir) will provide electricity to miners without disruption "as long as their consumption does not exceed the power plant's total output in a certain period."

Cryptominers have been blamed for power shortages in recent months that fueled public frustration in summer when the lights went off despite the fact that the share of legal e-currency miners in the total electricity consumption was and is negligible.

When the power supply was hit this summer, Tavanir started shutting illegal cryptomining units to curb blackouts.

According to Paven, the Energy Ministry's news outlet, in summer Tavanir seized 222,652 machines used by cryptominers at 5,861 unauthorized centers that collectively consumed almost 600 megawatts of electricity.

Whistleblowers provided information related to about 22% of the detected illegal units last week.  More than 35% centers were detected based on reviews of subscribers' electricity consumption. No details were provided about the remaining cases.

The Energy Ministry said some 31% of illegal miners were operating in residential areas.

New Bill With 3 Options

To remove legal loopholes of the past, the government has prepared a bill to regulate the work of cryptominers

From what is known so far, miners have three options for purchasing power:  build their own renewable power plants or purchase power from renewable plants; invest in energy-efficiency plans and get incentives; buy electricity via the Energy Exchange.

Khodadadi supports the plan despite observers saying that it would add to the existing constraints of mining digital currency.

"The new bill will help curb illegal use of subsidized power and facilitate miners' access to electricity at lower prices," he said.

Tavanir recently claimed that illegal cryptominers used 3.8 trillion rials ($16.5 million) in subsidized electricity and inflicted 380 billion rials ($1.3 million) in damages to the national grid.

The ICT Guild Organization claimed earlier that the bill was initially prepared by the Energy Ministry under the former government and is "in the interest of the electricity industry mafia."

Khodadadi rejected such charges saying that the intention is to minimize the Energy Ministry's interference in the key sector.